With health care at the top of the Obama administration’s agenda and a real opportunity for change by the end of this year, U.S. PIRG has been lobbying, researching and organizing for reform, focusing on the need to rein in the high cost of care.

Plagued By High Costs

This summer, we researched and released a series of reports on the exploding cost of health care. “The Small Business Dilemma” surveyed small business owners on health care. Seventy-eight percent of the owners we surveyed who do not offer coverage to their employees wish they could. Of that group, 80 percent cited health insurance’s high cost as the reason they don’t offer coverage.

An analysis by CALPIRG documented a major culprit for the rising costs: California spends roughly $9 billion on billing and insurance processing each year. Of course, that problem isn’t exclusive to California. In another report, “The Three Trillion Dollar Question,” we demonstrated that by implementing reforms, including streamlining the billing process and offering a public option to compete with private insurance companies, it would be possible to cut the cost of health care in America by $3 trillion over a decade.

Harry Shows What Hurts

We also toured the country with Healthcare Harry, our human-sized version of the kids’ game Operation, to get our message across in the districts of representatives who may prove to be decisive votes on reform.

Harry represents what’s wrong with health care: high premiums have emptied his wallet, he’s choking on red tape, and he’s getting the door slammed on him for his pre-existing heart condition. Harry’s tour, which started in Portland, Maine, made stops in cities from Atlanta to San Diego.

Elizabeth Warren, the Harvard law professor who was appointed to head the Congressional Oversight Panel on the banking bailout last year, explains it this way: “We don’t eat tainted meat and we don’t drink adulterated milk because we have fairly good regulation. Financial products are no different. Free markets are not well supported when consumers are at risk for injury.”

It’s painfully clear that Wall Street placed excessively risky bets that they could not cover, and that they paid executive bonuses on profits that did not exist. Worse, taxpayers, small investors, homeowners and our economy paid the price.

At the core of the crisis was a failure to adequately regulate financial products. 

Along with Warren and more than 200 organizations, U.S. PIRG is calling for the creation of a Consumer Financial Protection Agency. 

In both June and July, Ed Mierzwinski, the director of our consumer program, testified before Congress in favor of the new agency, which would have the power to regulate all credit card and consumer loan products, no matter where purchased; and to check predatory financial products, such as payday loans and risky mortgages.